Social news site Digg has finally been purchased, in a deal that puts it under the ownership of New York-based Betaworks.

The deal, which was announced on Digg's company blog this afternoon, will put Digg's technology inside of News.me, a daily news e-mail digest.

"Digg will join a portfolio of products developed by Betaworks designed to improve the way people find and talk about the news," Digg's former CEO Matt Williams said in a statement, adding that Betaworks founder John Borthwick will now be Digg's chief executive.

Details of the deal were not disclosed, though citing sources The Wall Street Journal says Betaworks paid around $500,000.

A brief history of Digg
It's been a long journey to Digg's purchase. Here's what happened on the way.

December 2004
Digg opens up to the world.

July 2005
Version 2.0 of Digg's home page is released with a redesigned look and new features.

June 2006
Version 3.0 of Digg's home page comes out. The big new feature are categories that take the site beyond tech.

August 2006
Co-founder Kevin Rose is featured on the cover of BusinessWeek with two thumbs up, a backwards hat, and a headline that says Rose made $60 million from the site in 18 months.

July 2008
Digg goes mobile with a smartphone-friendly version of its site.

August 2010
Matt Williams joins Digg, taking over as CEO for Rose. Digg releases its fourth major version of the site. The redesign stirs controversy among users, who dislike that publishers can automatically have their stories added to the site.

October 2010
Digg issues a second round of layoffs, letting 25 of its 67 staffers go, or 37 percent.

March 2011
Rose further removes himself from Digg to begin work on Milk.

Digg rose to fame shortly after its launch in 2004. The site garnered attention primarily for its algorithm, which would analyze user votes and decide which stories would hit the front page, where other users would then see them -- often for the first time.

After several years of growth -- including that of competitors -- Digg laid off 10 percent of its workforce in 2009, scaling back by another 37 percent later that same year.

The purchase marks a somewhat disappointing end to a patchwork of rumors that the startup would be bought up by a larger media or technology company for a phenomenal sum. One rumored $100 million offer from former Vice President Al Gore would have made Digg part of Gore's Current Media, and another from Google in 2008 would have valued the company in the ballpark of $200 million. Google reportedly walked away from that one in its final stages. Other rumored suitors at the time included Microsoft and two unidentified media companies.

Along the way, most of the attention turned to Digg co-founder Kevin Rose, who was briefly the company's CEO, following the departure of Jay Adelson. A fixture on the company's "Diggnation" podcast, Rose was the poster child of the Web 2.0 era. BusinessWeek famously ran a cover story on Rose in late-2006, with the headline "How this kid made $60 million in 18 months." Rose left the company to create an incubator called Milk, which was acquired by Google to become a part of Google Ventures back in May.

In a blog post about its acquisition, the company promised that it would "build Digg for 2012," that it was "turning Digg back into a startup," with a "low budget, fast team," and "small cycles."

Digg's entire engineering staff was acquired by The Washington Post Company's SocialCode two months ago, leaving the future of the site unclear. At the time, Williams simply told users to "stay tuned." Williams issued the same guidance today, saying that Betaworks was working on another "cloud-based" iteration of Digg that would "complement the current News.me iPhone and iPad apps."

What's Williams' next gig? He says he's joining venture capital firm Andreessen Horowitz as an "entrepreneur in residence" as soon as the site's handover is complete.

About the author

Josh Lowensohn joined CNET in 2006 and now covers Apple. Before that, Josh wrote about everything from new Web start-ups, to remote-controlled robots that watch your house. Prior to joining CNET, Josh covered breaking video game news, as well as reviewing game software. His current console favorite is the Xbox 360.
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